Analyze the NFT market Blur operation mechanism, profit model and user experience

2022-12-19 10:33

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Original title: Introducing New Entrants Blur: Another Challenge to OpenSea

Original source: Maverick, Wu said blockchain

Colin Wu says blockchain

Blur, an NFT marketplace that bills itself as a "service for professional traders", has had a stellar run recently after securing more than $14m in funding from Paradigm and others. According to NFTScan data, Blur was second only to Opensea in terms of NFT transaction volume in the past month as of December 16, accounting for approximately 29% of the total NFT market share (figure below), making it the largest NFT aggregate transaction market on the current chain. Put pressure on OpenSea like never before.

The official announcement that the BLUR Token will be launched next year, as a clear sign of the airdrop, is still established in the total amount, Token allocation and other Tokenomics is not clear. The Wool party is actually in a passive state of risk of anti-masturbating, but this does not dampen the enthusiasm of the Wool party. This enthusiasm may be related to the FOMO wave of airdrop caused by the OP and APTOS wealth effect, as well as the background of the delayed issuance of tokens by Opensea, the "unicorn" of NFT market. The first airdrop BLUR, which can be obtained if you have a trading record in NFT markets such as Opensea, LooksRare, and X2Y2 in the first six months, was introduced as a consolation prize and a new form of airdrop blind box promotion has attracted the attention of the Wool party. However, in the follow-up airdrop, Blur twice referred to the "next round is bigger" PUA community. However, the anticipation of Blur's ongoing third round airdrop, as well as the official promotion that "the third round as the final round is the biggest reward," has still contributed to the surge in Blur usage, especially since Orca almost dominates the charts, Also briefly led BAYC, Azuki and other blue chip NFT project trading volume and floor prices rose.

Blur uses the "custom royalty + zero fee + airdrop expectation" model to attract traders

Royalties have always been a sensitive topic in the NFT trading market, "traders want to maximize profits, collectors want to support creators, and creators want more royalty income". Because royalties are not enforceable in multiple markets, the royalty Settings vary from platform to platform, with Blur defaulting to the highest royalty among OpenSea, LooksRare and X2Y2. When traders list on Blur, they can customize the royalties for their listings. However, the zero and custom royalties of SudoSwap and X2Y2 respectively had already caused a great deal of discussion in the market. The market believed that the custom or zero royalties would cause the project side to lose some funds for sustainable development. Therefore, Blur expected to encourage prospective traders to use the royalties through airdrop to stimulate expectations. In the second round of airdrop, the higher the royalty setting of Blur users, the higher the loyalty they will get and the more airdrop they will get. However, for the user migration incentive of the zero-royalty platform of Sudoswap, the traders who pay the royalty will instead place the order on Blur and set the royalty as the platform fee of Sudoswap (0.5%). You get the same amount of profit and you get a bigger airdrop than you would otherwise. According to Proof's research director NFTstatistics.eth, however, this prospective encouragement did not actually prevent low or even zero royalty rates, as Blur's overall average royalty rate was only 0.65% (see chart below), driving down royalties in the overall NFT market (see chart below).

Blur doesn't charge users, as OpenSea, LooksRare and X2Y2 do. There is no cost to traders to use the Blur aggregator, trading market, and other features. Under the premise that the royalty is customized, traders can directly earn full revenue, but currently zero fees should be used as a short-term strategy to attract new users.

Blur has yet to decide on a profit model and is relying solely on financing for growth

As for how long the mode of "custom royalty and zero fee" will last, Blur officially stated that they will wait for the Token to be online and then conduct the royalty and fee decision and discussion through the community governance vote. Blur will not make any money until then. Whatever the final solution, it is predictable that Blur will end up in the "in-roll" battles over royalties and fees that are common in the NFT market. On the other hand, with no profit model and no revenue distribution, the value of BLUR Token is actually 0; If it exists only as a governance Token, it not only does not conform to the positioning of the platform Token, but also faces the possibility that it will be defeated by other later comers' imitation.

Match the experience of professional trading, but do not become a moat

In terms of experience, Blur officially claims to be 10 times faster than Gem, the aggregator acquired by OpenSea. In the real world, Blur runs fast and smoothly, but when buying in bulk, you'll pay more for Gas than in other trading markets. In the case of Element, buying one NFT at a time consumes about the same amount of Gas as buying a batch of NFT at a time, whereas with Blur, buying more NFT at a time consumes more Gas, which is probably why Blur almost never fails to buy NFT in bulk.

In UI/UX, Blur also matches the habits of professional traders. Taking BAYC as an example, the Blur homepage not only displays price, shelf time and last selling price, but also directly displays different NFT rarity. Users can directly select the rarity of NFT (1%, 10%, 25%) or price range for browsing. Real-time NFT sales, purchase and shelf time information is displayed on the right side of the screen. The lower right shows the price depth range of the NFT for the project. When a specific NFT is clicked, Blur will display the specific features of the NFT, along with the last sale time, floor price and trading volume proportion of each feature, allowing traders to determine the rarity of the NFT.

Blur provides traders with professional tools, good UI/UX and other ancillary features, but it is important to recognize that these ancillary tools are not monopolistic and can be copied. As of now, Blur doesn't have a "moat" deep enough to guarantee that Blur won't be defeated by a subsequent challenger. As the brand effect of Opensea's first-mover advantage has formed strong enough user engagement, ordinary users should first consider the depth and liquidity of the transaction when using NFT trading market, and whether the transaction cost is low enough, while the consideration of whether the platform functions are useful is behind these two factors.

Overall, the main reason for Blur's attention in the market is the medium-term airdrop expectation. It remains to be seen whether Blur can form long-term user engagement, especially after the airdrop landing is the real test.